Back in the day, retailers had a lot of power over which brands, and which products were on hand for their customers had to choose from. The customer was basically restricted to whatever the local retailer(s) carried, as mail ordering skateboards through the United States Postal Service took forever and ever, was fraught with problems... and generally speaking, it was all one big humongous pain in the ass.
Most of the retailer's power came from the fact that they had the ability to either let brands into their shops... or, deny retail access to those brands. The brands that got into skate shops generally thrived, while the brands that failed to make headway on the retail front almost always failed. Thus, the main goal of any new, start-up brand was to find their way into the local skate shops. The more local skate shops that bought into that brand, the more successful that brand ultimately became.
At the end of the day, the "successful" brands ultimately sold out, and bailed for Zumiez... while the average skater-on-the-street never really got to see what the "failures" had to offer in the first place. But, all hell pretty much broke loose when...
In today's post-internet world, brands no longer need the retailers to make their way into the marketplace. If the retailers say "Go screw yourselves! We don't want your crap!", the brands can always say "Well, screw you harder! We're taking our 'crap' elsewhere...!" And then, they take their wares to one of the ten-gazillion e-tailers out there. Or even better yet, directly to the customer.
This has a lot of repercussions for everyone. This gives the average skater-on-the-street more choices than ever before. It also (generally) lowers costs, which makes skateboarding more affordable for everybody.
But it also tends to have a deflationary effect on retail prices, as everyone tries to undercut everybody else to gain a competitive edge in the marketplace. In an industry where the brands have yet to embrace simple MSRP/MAP pricing structures (and if they haven't already, I doubt that they will any time soon)... the "race to the bottom" will probably keep on racing right along.
As far as the core retailer is concerned, this definitely sucks all the way around. Because they're losing customers to everybody else. They have to work that much harder to promote themselves, and treat their customers well (or they'll take off and go somewhere else, where they're treated better). And the few sales they have left make them less money than they did before, because retail prices are tumbling.
Now it's not just the small, upstart brands that are racing straight to the customer; even established brands with a strong market presence are abandoning retail, for better margins and [something sorta resembling] brand loyalty [maybe].
There exists a common theory that most broke-ass, piss-poor skaters won't pay much more than $60 bucks for a cheap, disposable hunk of pressed lumber. I'd say that there might be a lot of truth in that. Indeed, a lot of skaters think that even sixty bucks is too much to throw down... thus, the influx of increasingly popular "pricepoint" product (blanks, shop decks, logo boards, "pricepoint sub-brands of established 'premium' brands", etc...).
At the same time, inflation has assured that the costs of pretty much everything... raw materials, overseas shipping, slave labor, shit like that... has steadily increased over time. The resulting margins for retail shops have shrunk to the point of being virtually negligible.
These pricing instabilities have traditionally affected hardgoods, primarily. But anyone that thinks that these trends won't soon affect softgoods, footwear, or high-margin niche hardgoods is probably well out of their minds. Indeed, it's already happening. And the problem will surely only get worse as time marches on.
With the internet, and the rush of tiny little upstart brands running into the marketplace with great deals (and even, good products)... the "value" of the branded skateboard deck has fallen precipitously from nearly $60 just a few years ago, to around $45, today.
Indeed, you can even find 100% American-made, limited-run, fully screen-printed decks from kick-ass little brands for around this price, pretty regularly. And those guys are usually really cool people, too. Sometimes they'll even toss in a free t-shirt, just for kicks.
So, you tell me: Why would any skater even think of throwing down sixty bucks for your cookie-cutter, third-world-labor-made, imported, mass-manufactured poopsickles at a "core retailer"... when with a few clicks of a mouse, they could get a truly quality product delivered right to their door, swoop a few freebies, and still manage to save some cash while they're at it...?
I've talked a lot about customer service at skate shops in the recent past, and here's where the math starts to catch up to the core retailers:
In the recent past, their "trump card" has been the value-priced "shop deck". Even if they give their customers menial-to-shitty service, the fact always remained that the core retailer had the shop-deck pricepoint, and gawd-dummit, they were gonna milk that one for all that it was worth...! They had the margins, and they had pretty acceptable quality for the average kid, while still going relatively easy on the average mom's and dad's wallets.
Problem is, a lot of legitimately "branded" product is now hitting the market at around the "shop-deck" pricepoint. And, believe it or not, a lot of these brands offer way, waaaayyy better customer service than most "core retailers" do. So, you tell me: Where does this leave the core retailer...?
Even worse: Where does this leave the $60-dollar-pricepoint, "premium" brands...? After all, most kids aren't even gonna question why my "legitimate brand" is so affordable. What they will question, is why your "legitimate brand" is continually ass-raping their debit card.
Here's another area where the core retailer has severely dropped the ball. I've heard fairly believable statistics that say that last year- 2009- "street market" sales were down roughly 2%, across the board. At the same time, longboard sales were up around 42% on average.
Now, a lot of shops tell me that longboarding is "gay", that it's not "legitimate", that "there's no market for longboards", etc. Well if you ask me, a 42% spike tells me that someone's finding a market for these gay-ass push-planks out there somewhere...!
Now, do I expect the longboard market to keep growing at an annual return of 42%, indefinitely? No. Nothing grows forever and ever. At some point, this whole thing will level out. In the meantime, every retailer that wrote off longboards in 2009, left a shit-ton of money on the table for somebody else to put in their pockets.
The uglier truth is that, a lot of retailers haven't smartened up much for 2010. Naturally, I have to wonder to myself: How much money are they leaving on the table this year...? And who, exactly, is profiting from their denial and complacency...?
So, what's gonna replace skateshops as the boots-on-the-ground "scene incubator", if the shops can't manage to keep up with all of these sudden changes in the marketplace...? The answer is pretty simple: The Skateboard Club Concept. Now, I know damn good and well that a lot of "industry heads"... shop owners, included... and even, a whole lotta skaters... are going to think that I'm a total retard for even suggesting that skateboard clubs could (or should) rightfully exist. Let alone, that they might ever replace the good 'ol stoic-and-stodgy brick-and-mortar skateshop as the glue that holds local skate scenes together. So, go ahead and laugh all you want! I'm a big boy, I can take it...
But while you're laughing, think about this: I'm actually watching it happen, right in front of my very eyes. And it's really pretty fuckin' cool, too.
Even better: Our local skateboard club (the Old Indy Skaters) is in the process of starting up an Ohio chapter, as I write this little pictorial essay. Now, chew on this: One year ago, OIS didn't even exist. That, my friends and enemies, is pretty quick progress in an industry where any sort of "progress" is pretty hard to come by these days.
OIS currently gets manufacturer support from such brands as Unity Skateboards, American Nomad, and Funhouse. These are smart brands that want to align themselves with communities of happy customers. And, it does seem to work. I think I was the last dude in the crew to get a Nomad deck (I bought two, because I realized I was slacking so hard). At the very least, it's damn good word-on-the-street, skater-to-skater advertising. The brands are stoked on the skaters. And the skaters are stoked on the brands, for being stoked on the skaters. It all works out for everybody. The only "trick" seems to be, to get (and stay) involved.
So while shops, brands, and the media wrings their hands and scream to each other, "How do we build better communities around skateboarding?!"... Bart and the guys are out there stepping it up, getting their hands dirty, and getting it done. One skater, one scene, one city, and one state at a time.
The smarter guys will stand up, take notice, and take notes. The rest of 'em will probably keep on laughing themselves into either irrelevance, or bankruptcy.
The future of retailing is going to be pretty simple: Online retailers that stock [quite literally] everything under the sun... big brands, small brands, emerging brands, legacy brands, you name it. They'll feature all sorts of boards, trucks, and wheels for all sorts of skaters. They're going to cater to anyone and everyone- the young, the old, males, females, majorities, minorities, and everybody in between. They'll be jam-packed with handy, useful information to help everybody from the noob, to the expert find what they need to know in a simple and straightforward manner. The customer service, of course, will be top-notch... since that's the only thing that will truly differentiate one e-tailer from the next. And, they'll even have a certain amount of "local community news" for skaters to find local spots, crews, and events in their neighborhood.
In short: They'll be one-stop skateboarding superstores. If you think that Zumiez is the "Wal-Mart of Skateboarding", just wait until the other foot drops and shows Zumiez how it's really done, done well, and done right.
Note: These are all things that the "core retailer" should have been doing all along. The current pressures on the core retailer surely won't make it any easier to catch up with all of these changing paradigms in the future. This industry is turning itself inside out right in front of our eyes, and nobody has any time to waste. The future is already here. And if you're not ahead of the game by now, you're probably behind.
